Saturday, April 24, 2010

Ford Motor Co. (NYSE: F): Q1 Earnings Preview 2010

Ford Motor Co. (NYSE: F) is scheduled to release its first-quarter financial results before the opening bell on Tuesday, April 27, 2010. Analysts, on average, currently expect the company to report earnings of 31 cents a share on revenue of $30.49 billion. In the year ago quarter, the company reported a loss of 75 cents per share on revenue of $21.37 billion.

Ford Motor Company designs, develops, manufactures, and services cars and trucks worldwide. It operates in two sectors, Automotive and Financial Services. The Automotive sector sells vehicles under Ford, Mercury, Lincoln, and Volvo brand names. It also holds a one-third stake in Mazda.

In the preceding fourth-quarter, the Dearborn, Michigan-based company reported that it swung to a profit of $868 million or $0.25 per share, compared to loss of $5.98 billion or $2.51 per share in the year-ago period. On an after-tax basis, excluding special items, Ford posted an operating profit for the quarter of $1.57 billion or $0.43 per share, compared with a loss of $3.33 billion or $1.40 per share in the previous-year quarter. Revenue jumped 22% to $35.4 billion from $29.0 billion in the prior-year quarter and $30.9 billion in the previous quarter. Analysts, on average, expected the carmaker to report earnings of $0.26 a share on revenue of $32.60 billion.

For fiscal year 2010, the company expects to be profitable on a pre-tax basis excluding special items, with positive Automotive operating-related cash flow. Based on its recent performance, Ford expects total company and North American Automotive operations to be "solidly profitable" for 2011 on a pre-tax basis excluding special items, with positive automotive operating-related cash flow.

Ford has benefited from a relatively fresh lineup along with goodwill garnered from avoiding bankruptcy and declining to take money in a federal bailout, unlike Chrysler and GM. The automaker plans to introduce a higher number of new products in 2010. The carmaker has agressively slashed cost, addressed underperforming assetsimproved liquidity position and strengthened its balance sheet. Ford Motor Co will focus strongly in 2010 on reducing heavy long-term debt and narrowing a cash-flow edge held by its bailed-out U.S. rivals. Ford has also got a boost from recall troubles at rival Japanese auto-giant Toyota Motor.

The automakers's turnaround plan has yielded fantastic results. It recorded sharp jump in US auto sales in the first three months of 2010. Ford Motor Co. reported that its March sales increased 39.8% to 183,783 units from 131,465 units in the year-ago month. Its February U.S. sales rose 43.1% while January U.S. sales rose 24.6% from a year ago. The company's market share rose 2.7 percentage points from January through March, Ford's sharpest increase in a three-month period since the fourth quarter of 1977. Through March, Ford's share of U.S. sales was 17.4%, putting it behind only General Motors' 18.7%.

Additionally, the automaker recently reported a record 84% rise in unit sales in China for the first quarter, including joint ventures, attributed to robust sales in its passenger car and commercial vehicles segment. Separately, the company said its March unit sales in India rose 203%, on strong demand for its newly launched Figo.

Ford is swiftly launching more fuel efficient and smaller engines--with direct injection and turbocharging--under the EcoBoost label, fitting them first to the 2010 Lincoln MKS sedan and MKT crossover and to the Ford Flex crossover and Taurus SHO performance sedan. Its revamped 2011 Edge crossover will offer a 2.0-liter EcoBoost four, and it has already shown its subcompact 2011 Fiesta and compact 2012 Focus--both offered as four-door sedans and five-door hatchbacks--to great acclaim.

Ford shares have gained 38 percent since the beginning of the year. Shares of the company closed at $14.21 on Friday.

Full Disclosure: None.
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